Retailers that incorporate a strong omnichannel and optimised mobile experience into their marketing strategies are driving increased gift card sales and greater customer loyalty, new research commissioned by leading global branded payments firm, Blackhawk Network (BHN) has shown.

The 2023 Merchant Gift Card Omnicommerce Evaluation report found the number of retailers using mobile apps jumped significantly from 4% in 2021 to 34% in 2022 and for those that embraced the technology, it had been a key success driver.

While much of retail is in a downturn, the Australian gift card market is forecast to grow at an annual rate of 9.1% over the next four years to reach $13.83 billion by 2027.

BHN marketing director for Asia Pacific, Mark Phillips said the report highlighted the importance of a strong omnichannel strategy and of mobile apps in generating increased sales and greater customer engagement.

“Many Australian retailers are leading the way with their gift card programs in terms of success and customer experience and a significant part of that is attributable to their well-developed adoption of digital channels,” he said.

“We know 85% of Australians are using multiple digital touchpoints on their purchasing journey so retailers need to be agile and embrace these technologies to connect with consumers wherever they are. All the data points to Australians increasingly using their mobiles for researching, shopping and paying for goods and a well-designed, optimised app can help brands engage with their most loyal customers.”  

According to the We are Social Digital 2023 Australia Report, Australians spent $2.39 billion on app and in-app purchases last year, up 3.3% or $77 million on 2021, with 41.7% of all ecommerce transactions conducted via a mobile phone.

Gift cards are a proven means to grow customer loyalty and increase revenue with previous research finding that three-quarters (75%) of customers spend more than the value of the gift card with an average 40% more being spent then the original value of the gift card.

From an industry perspective, the report found that department stores, health and beauty, and home furnishing retailers are leading the way across the board with their physical, digital and mobile gift card programs.